What is multibagger stock? How to identify best multibagger stocks for the investment? Which are potential multibagger stocks for FY 18? Before getting an answer of these questions let us go through one real life example – My friend had purchased 1000 shares of Tata Mataliks by just making an investment of 1 Lakh in April, 2016. In just one year time frame this stock had turned out to be multibagger stock. His capital investment has grown by 5 times in one year. From this example, it is clear that multibagger stock is stock that can give multi fold return to the investor. A potential multi bagger stock can make you wealthy in short period of time. So, let’s try to get more information about such stocks.
What is Multibagger Stock?
A stock that gives several times returns on the cost is called multibagger stock. A stock that doubles its price is called two-bagger stock. If stock grows 10 times it is known as 10 bagger stock. If it grows by 100 times it is 100 bagger stock. Multi-Bagger stocks are undervalued stock with strong fundamentals, future business potential, and strong corporate governance.
Examples of multibagger stocks in India
There are several stocks in India which have given multifold returns to the investors. Caplin Point Laboratories is an example of multibagger stock. Caplin Point Laboratories has grown 10 times in short period of time. Other stocks in this category are Uniply Industries, Page Industries, Ajanta Pharma, Tata Metaliks etc.
How to Identify Multibagger Stock?
Hunting for a potential multibagger stock is a difficult task. You can follow steps given below to identify potential multibagger stock.
- The debt level of a company should be low. A company should be nearly debt free.
- A revenue of company should be growing quarter to quarter. A performance history of a company should be good.
- The company should have good source of earning with scalability in operation.
- The company business model should be sustainable and should have favorable future business potential.
- Business expansion, a global market presence or new monopoly product could be added advantage.
- The valuation of stock should be low.
- A management of the company should be strong and clean and decisive.
15 Best Multibagger stocks of 2017 – Up to 500% return
The financial year 2016-17 was a year of multi bagger stocks. There were many stocks that turned out to be multi bagger stocks last year. Few mulltibagger stocks of 2017 are Tata Metaliks, Thirumalia chemical, Shilpi cable etc.
15 Multi loser stocks of 2017
Apart from multi bagger stocks there were few stocks that turn out to be multi loser stocks in last financial year. Few Multi loser wealth destroyer stocks of 2017 are Toyam Industries, BS Ltd, Visagar Polytex etc. 15 Multi loser stocks of 2017 are given below.
15 Potential Multibagger stocks for FY2018
It is anticipated that FY 2018 will be another good year for the stock market investors. Few potential multi bagger blue chip stocks for the investment as per Motilal Oswal are Tata Motors, ICICI Bank, SBI, ITC, Britannia, Hindalco, Colgate Palmolive India, Crompton Consumer, IOC Ltd, RBL Bank, Manpasand Beverages, Ultratech Cements, Force Motors, Maruti and JK Cement.
Over to You –
What is your call on above Stock Pick?
Do you carry these stocks in your portfolio?
Do you think that these shares will outperform in future?
Do share your valuable comments and suggestion in the comment section.